One New CANSLIM Swing Long, One New Speculative CANSLIM Swing Long, One New Speculative Swing Long, And One Long I Am Adding To My Position

May 26, 2007

new CANSLIM swing long: RRST

RRST is bouncing off recent support near the 50 dma and the early May’s breakout pivot point, on average volume. What makes this bounce so nice is that it is around three key support areas, there is a ton of accumulation since the May breakout, and BOP is max green and has been since the 18th. Fundamentals are extremely strong with EPS growing between 50% and 200% the past five quarters and sales growing between 29% and 47% the past eight quarters. Fund ownership has increased from 9 to 10 the past two quarters and management owns 52% of the stock. So obviously the big boys like this one. Cut your first loss with a close below the 16.25 area and your final loss with a close below the 50 dma, if the stock does not move higher immediately.

new speculative CANSLIM swing long: IFOX

IFOX is breaking out of a three-and-a-half month cup with handle pattern, on very strong volume. What I like about this chart is that the breakout is very powerful, the accumulation is very strong this month, and BOP has gone max green. What I don’t like about this chart is all the red BOP in March, the nasty price action in March, and the RS line has not made a 52-week high along with the price (that is negative divergence). The fundamentals are strong but they are slowing, EPS has gone from 999% growth to 60% growth the past three quarters and sales has fallen from 69% to 6% the past three quarters. Fund ownership has grown from 28 funds to 37 funds the past four quarters and management owns 17%, so there is interest for this stock. Cut your first loss with a close below the 16.41 area and your final loss with a close below the 50 dma, if the stock does not move higher immediately.

new speculative swing long: SXE

SXE is breaking out of a sloppy cup with handle pattern, on above average volume. This chart is very beautiful after the move off the April bottom, with all the green BOP, strong accumulation, and great intraday price action. What makes this chart a bit off is the sloppy and choppy way the cup was built, the right side of the base was created much faster than the left, the RS line is not making a new high when price is, and BOP is still green but going in the wrong direction. This is still a very pretty IPO chart. What, no doubt, is the reason for the recent move, is the recent gains in EPS and sales. EPS grew 999% the most recent quarter, reversing losses, and sales has grown between 12% and 48% the past six quarters. Management owns 29% but fund growth has slowed down from 33 to 27. However, with EPS estimates for YOY gains of 55% in 2008 and a 20% gain in 2009, that could change in recent quarters. If I am wrong, cut your loss with a close below the 16.96 area, if the stock does not move higher immediately.

adding to speculative CANSLIM long: SNCI

SNCI is breaking out of an ascending base on flat base pattern, on strong volume. This chart is extremely beautiful with all the green to max green BOP, all the accumulation since late January, the extremely strong intraday price action seen almost every day since the move in October, and with the excellent reversal off the 50 dma in early May. What I don’t like about the chart is that moneystream and RS line are not hitting new highs along with price and that BOP, despite being very green, is still not max green. If BOP was max green still, this chart would be perfect. The reason for all the recent price gains has to be due to the fundamentals. EPS has turned around and has seen gains of 111% and 175% the past two quarters and sales has grown 11%, 24%, and 18% the past three quarters. Estimates for 2008 are for a YOY gain in EPS of 127%. A couple of problems with the fundamentals is the SMR (sales, profit margin, and ROE) rating is an E (the worst grade you can receive) and the fund ownership has seen no growth falling from 20 to 19 the past four quarters. All the accumulation is being done by the funds that are already in the stock. Cut your loss with a close below the 50 dma, if this beautiful chart does not move higher immediately.

One New CANSLIM Swing Long, One New Speculative CANSLIM Swing Long, One New Speculative Swing Long, And One Long I Am Adding To My Position

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